Note 11 - Fair Value Measurements

3 Months Ended

Dec. 29, 2019

11	FAIR VALUE MEASUREMENTS

We utilize FASB ASC Topic

820,

Fair Value Measurements and Disclosures

, to measure and report fair value. FASB ASC Topic

820

defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. FASB ASC Topic

820

establishes a

three

-level hierarchy of fair value measurements based on whether the inputs to those measurements are observable or unobservable, which consists of the following levels:

Level

- Quoted prices for identical instruments in active markets.

Level

- Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are

not

active; and model-derived valuations in which all significant inputs are observable in active markets.

Level

- Valuations derived from valuation techniques in which

one

or more significant inputs are unobservable.

The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate value.

The carrying amounts of cash equivalents, accounts receivable and accounts payable approximate fair value because of the short maturity of those instruments. Investments totaling $

6,068,000

, including our

17%

ownership of the non-voting common stock of TCT and a private equity investment, are carried at cost. As of

December 29, 2019

, based on the most recent data available, the approximate fair value of the private equity investment is $

10,268,000

which is a level

fair value measurement. Fair value of the remaining investments approximates book value.

Our fixed rate debt consists of $

356,141,000

principal amount of the Notes and $

77,253,000

principal amount under the

Lien Term Loan. At

December 29, 2019

, based on private market price quotations, the fair values were $

344,789,000

and $

76,481,000

for the Notes and

Lien Term Loan, respectively. These represent level

fair value measurements.

As discussed more fully in Note

we recorded a liability for the Warrants issued in connection with the Warrant Agreement. The liability was initially measured at its fair value and we remeasure the liability to fair value each reporting period, with changes reported in other non-operating income (expense). The initial fair value of the Warrants was

$16,930,000.

The fair value of Warrants at

December 29, 2019

and

September 29, 2019

are

178,000

and

1,195,000

, respectively. Fair value is determined using the Black-Scholes option pricing model. These represent level

fair value measurements.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details